DeviseEngg

More than 4 million students graduate out of Indian technical institutes every year. It is a huge number but really speaking, it is a ‘herd’. Stuides indicate that the employability quotient of these graduates and diploma holders is as low as 18%. We also need to remember that a significantly high percentage of this 4 million i.e. around 1 million went for technical studies only because their parents told them to.

Most engineering institutes in the western and central states are sponsored / run / operated by big-ticket politicians. While they have to attract the cream candidates and need a decent infrastructure, on an average the graduate from Indian technical institutes suffers from:

Exposure to outdated curriculum

Lack of practical knowledge

Lack of industry knowledge

Infact, it is much more valuable to take up a diploma course than a degree course as it provides more ‘practical’ and ‘hands-on’ exposure. However, diploma holders are not well received by the industry. Their starting salaries are meager and their lack of outwardly sophistication outplays their strong technical knowledge.

Companies struggle to find talent. You may wonder how can that be when the source is outputting 4 million targets.

Companies hire from institutes that are reputed i.e. IIT, Regional Colleges and Government Colleges, or institutes that ‘vet’ and market themselves. All in all, companies tap into a very small number, at best 1 to 5 % of the total graduating population for active hiring. And yet, they do not trust the knowledge of these students and send them into another level of training which is mostly again theoretical.

One of the companies we studied, a shining star of the Indian IT industry, puts the candidates through a 6 months finishing school before they are assigned real work. Most such fresh-hires don’t even find any difference between college classes and what they go through in the first six months.

Another core technical company that we studied closely hires mostly based on the “behavorial” soft-skills of the candidates as they don’t get any time and don’t know of any way to spot candidates who are “innovative” and “practical”. They rarely are able to select new hires that are talented enough to be accelerated in the career and they rarely cater to a one-to-one skill gap determination. Even if they do, they don’t have in them to aid the candidate overcome that deficiency. Companies expect a mix of ‘innovation’ and ‘street smartness’ from the hired candidates, however they don’t have the ways to filter these elements before hiring. It is obvious that retention will be an issue.

What is the need of the hour, is proactivity. It is to hire right at the source and for that appropriate mechanisms have to be devised. Technical interviews need to be converted into games tackling real world challenges with more than one candidate being assessed at a given time. Methods have to be laid out for tapping into all 4 million candidates with a stage-wise filtering. There are a select few companies who do this. They are countable.

Devise Electronics focuses on the niche segment of automotive electronics and leading research and development activities across the space of the automotive industry. Devise caters to the gaps in the industry, there-by enabling OEMs and Tier 1’s to launch their electronics and electronics assisted products with supreme quality while being prudent in the engineering process and cost.

Numbers don’t lie and the Indian consumer is no longer ready to be taken for a ‘ride’. The vast choice and the increased variety of cars in the market has really made the consumer the KING. From the top-sellers and fuel-efficient cars from Maruti Suzuki to the top of the class European brands – everything awaits the consumer.

The choice and variety can truly be over-whelming for the Generation X, the middle aged Indians who in their hey-days could only choose from a handful of models – the Ambassadors, the Premier Padmini and the Maruti 800. The folks who wanted to stand-out bought the Contessa or 118 NE. Unlike, the choice to the Indian voter, there was no “None of the Above” option.
Now, there are probably a bit more than 20 manufacturers in the market with close to around 150 models and around 1000+ variants. The consumer is ‘smart’ and given the realization that he is the KING has surely made him ‘toss away’ the cars that do not appeal. At the same time, the consumer has an ego, an ego that remained suppressed through his childhood where-in he only state-of-the-art cars only on the centerfolds of magazines or being driven by the ‘filthy rich’. So much to say, owning the ‘cheapest car’ did not appeal to him.
Discussion related to cars is in terms of ice-breakers only second to that about cellphones. It even surpasses cricket. So price, features, quality, serviceability – everything and anything is a talking point. Such plain talk is the influencing factor for the next purchase and unfortunately there’s not much of purchase happening. The growth in the Total Available Market that was used as an input for the huge investments Ford, Chevrolet, Renault, Nissan et al have made is no where visible.

The market has been ‘flat’ at best and most of these manufacturers are happy even with the gain of a few points in the market share. Yet, there’s no eating into the slices of Maruti Suzuki and Hyundai.

Thanks, however, to the huge drop in the market share of Tata Motors, most new entrants have still managed to stay happy and rise up.

The adjoining graphs show the shrinking size of the yellow slice of Tata Motors. From a sizable 14% in early 2012 to 6% in the closing months of 2013, Tata Motors is the only shrinking slice of the pie. In the people carrier, Sumo and Safari struggle against Mahindra’s Bolero and Scorpio, the lack of a solid challenge to the Toyota Innova clearly indicates a big miss in the strategy.

As for the personal use, the Nano hasn’t even sold 2000 numbers per month, while the Indica and Indigo haven’t been able to keep pace with the Generation Y and Z. The Ambassador and the Padmini never appealed to the Generation Y, similarly the Indica and Indigo models haven’t appealed to the Generation Z who though isn’t behind the wheels yet, but prescribes the purchase to his parents. Honda and Ford have taken bigger strides. The biggest segment the Indica and Indigo’s now cater to is the ‘small taxi’ and the ‘city cabs’.

As cheaper options in this category emerge from Chevrolet, Nissan and Renault, this remaining ‘lean’ portion of Tata Motors is also at risk.

What’s the solution you may ask ? – Clearly they have to improve and chase – either the fuel efficiency of a Maruti or the quality of Toyota or the reliability of a Mahindra but most importantly Tata Motors needs a visual overhaul and move over from the Nano, Indica and Indigo.

So today I was driving on the Pune – Mumbai expressway and to my surprise I saw the test runs of Bajaj Quadricycle RE60. The launch should not be far away (and I have not noticed if it has already happened).

Few years ago Bajaj made it to the news by saying that they will be working with Nissan (and Renault) to get the cheapest car on the roads – cheaper than the ‘Nano’. I am glad that they failed or discontinued their attempt because the folks behind Tata Motors had got the Market Strategy and positioning all wrong.
Tata Nano, simply failed, because of the following 2 elements:

1. Everyone who owns and Indica or Indigo or anyone who knows anyone who owns an Indica and Indigo, will never buy a Tata vehicle unless it completes 2 years in the market and the reports are good. And for Nano, the reports were never favorable.
2. 99% of India thinks of the car as a status symbol and any such individual would never like to possess the ‘cheapest car’. Infact, with Tata Nano entering the market as the cheapest car, the sales of Suzuki 800 and Alto increased because they were no longer regarded as the cheapest.

With regards to the RE60 Quadricycle from Bajaj, I have struggled with the market positioning of this car or vehicle or quadricycle (whatever, they want it to be called). It is not legally classified as a car and it cannot be sold to individuals. So, it is not competing with Tata Nano but it is competing with either the Tata ACE and likes, which given it’s size, I doubt it will be able to.
So, in a nutshell it is just a replacement for the normal 3-seater auto-rickshaw – a category that Bajaj already has a strong presence in.
Today, the car was out on the highway, for what appeared to be mileage tests, running at the regulated speed limit of 80 kmph. Their max. speed is anyway 90 kmph.
According to Bajaj, the RE60 will give three-wheeler users the safety of a fourth wheel. That’s not a bad thought – in-fact the Tata ACE Magic and the likes already have people carrier versions that have replaced the 6 and 9 seater auto rickshaws in the city suburbs and rural areas.
However, with two front-wheels and a steering wheel, if it is to replace the normal auto-rickshaw on the streets of the city, the maneuverability is the biggest element that will be compromised. In comparison with the normal auto-rickshaw the price will be at-least double and unless there is a Government mandate to add safety (as offered by a complete body) elements to the three-wheelers, I don’t see this segment moving upwards.
Had this product made it to the market before the Tata Ace and likes, it would have managed to create a segment, a share and would have been the most-selling USCV (Ultra Small Commercial Vehicles). However, it comes 10 years later than when it should have made it to the market. The story is very similar to that of Tata Nano – a ‘flop’ strategy and market placement – and
At the end of the day, we can praise frugal engineering as much as we want to. And our Prime Minister may continue selling these buzz words everywhere he goes. But, like Tata Nano, this product lacks common-sense engineering.
Frugal Engineering should never compromise Common-Sense Engineering. We need products that people need, and for that mis-match RE60 isn’t going to ink any success story.